February 17 Financial Morning Report: Market Liquidity Tightens, Gold Prices Under Pressure, Iran Conducts Live-Fire Drills in the Strait of Hormuz, Supporting Oil Bulls

Huitong Net, February 17 — During the morning session of the Asian market on February 17 (GMT+8), spot gold was trading around $4,998.31/oz. Gold prices came under pressure and fell on Monday, as some investors were forced to exit leveraged positions, causing a temporary tightening of market liquidity.

On Tuesday (February 17, GMT+8) during the Asian morning session, spot gold was trading around $4,998.31/oz. Gold prices were under pressure and declined on Monday, as some investors were forced to unwind leveraged positions, leading to a temporary tightening in market liquidity. US crude oil traded higher, around $63.70/barrel, as investors digested the OPCE+ production increase plan, and Iran's live-fire military exercises in the Strait of Hormuz increased geopolitical uncertainty risks.

Key Focuses of the Day

Global Markets

Global markets stabilized during Monday's trading, recovering some of the ground lost last Friday due to concerns related to artificial intelligence. With many Asian markets closed for the Lunar New Year holiday and US stock markets closed for Presidents' Day, overall trading was relatively subdued.

European stock markets rose, led by a rebound in the banking sector, with the pan-European STOXX 600 index closing up by about 0.3%. US stock index futures also edged higher, indicating a possible positive open for the US stock market.

On the economic data front, Japan's Q4 annualized GDP growth rate preliminary value was only 0.2%, far below the market expectation of 1.6%. This weak data highlights the challenges facing the Japanese economy, and the market believes it may provide more justification for Prime Minister Sanae Takaichi to push for more aggressive fiscal stimulus policies. Nevertheless, some investors remain optimistic about the long-term positive impact of her reflation policies on the Japanese stock market.

Market attention is turning to a series of key data and events to be released this week, including the revised value of US Q4 GDP, preliminary PMI readings from multiple countries, as well as inflation data from the UK, Canada, and Japan. In addition, Walmart's financial report is also in focus, as the market looks for insights into US consumer spending.

Massive capital expenditure plans in the field of artificial intelligence continue to be a market focus. According to Goldman Sachs, as this spending surges, the scale of stock buybacks by S&P 500 companies has declined compared to a year ago. This reflects that as companies intensify investments in AI infrastructure, they may be adjusting their capital allocation.

In the commodities market, investor sentiment remains cautious, and precious metals and energy products have shown divergent trends. Gold prices came under pressure and fell, with spot gold dropping to $4,965.06/oz at one point on Monday. Recent volatility in the gold market has intensified, mainly because some investors were forced to exit leveraged positions, which temporarily tightened market liquidity. Silver has also shown weakness.



On the crude oil market, oil prices rebounded slightly by more than 1.4%. Brent crude reached as high as $68.73 per barrel, while US crude peaked at $63.87 per barrel. This rebound in oil prices was mainly driven by supply-side news. OPEC is inclined to resume increasing oil production starting in April this year, and the market is digesting this potential adjustment in supply. Analysts pointed out that, in the coming weeks, the commodities market will continue to face the intertwining influence of multiple factors, including the demand outlook of major economies, geopolitical risks, and the production policy direction of major oil-producing countries.

International News

According to CME “FedWatch”: the probability of the Federal Reserve cutting rates by 25 basis points by March is 7.8%, and the probability of keeping rates unchanged is 92.2%. By April, the cumulative probability of a 25 basis point rate cut is 25.3%, with a 73.1% probability of rates remaining unchanged, and a 1.6% probability of a cumulative 50 basis point cut. By June, the probability of a cumulative 25 basis point cut is 52.6%.



The Swiss Foreign Ministry stated in a media statement on the evening of the 16th that the third round of Russia-US-Ukraine trilateral talks, which will begin on the 17th, will be held behind closed doors and the media will not be allowed in. The third round of talks is scheduled for the 17th to 18th in Geneva, Switzerland. The Russian delegation is led by Russian Presidential Assistant Medinsky, while US President Trump's envoy Vitekoff and son-in-law Kushner are the main US representatives. The Ukrainian delegation includes Secretary of the National Security and Defense Council Umerov.



According to Iranian official media reports on February 16, the Iranian Islamic Revolutionary Guard Corps Navy is conducting "composite and targeted" live-fire military exercises in the Strait of Hormuz. Revolutionary Guard Corps Commander Pakpour supervised and directed the exercises on site. The main objectives are to test the combat readiness of naval units, review security control plans for the Strait of Hormuz and reciprocal military action plans, and to intelligently leverage Iran's geopolitical advantages. (CCTV International News)



On February 17, the US and Iran will hold a new round of indirect talks in Geneva, Switzerland. The Iranian delegation, led by Foreign Minister Aragchi, arrived in Geneva on February 16. US President Trump's envoy Vitekoff and son-in-law Kushner will represent the US side. Oman will continue to mediate. The Omani Ministry of Foreign Affairs stated on social media on February 16 that Omani Foreign Minister Badr met Aragchi in Geneva to discuss preparations for the new round of negotiations. The Omani Foreign Ministry stated that both Oman and Iran believe that all parties should actively promote better understanding and consensus, striving to reach an agreement that meets the interests and expectations of all parties. The US and Iran previously held indirect talks in Muscat, the capital of Oman, on February 6. Both sides stated after the talks that negotiations would continue, but from public statements, both remain unwilling to compromise on core differences. (CCTV International News)



German Federal Interior Minister Dobrindt announced on the 16th local time that the German government will extend the temporary border control measures, originally set to expire on March 15, 2026, for another 6 months. He revealed that border controls are part of Germany's migration policy adjustment. Relevant notifications are being submitted to the European Commission. According to current EU regulations, there are generally no systematic border checks in the Schengen Area, so member states must follow formal notification procedures when resuming or extending border controls. (CCTV News)



Bank of Japan Governor Ueda stated that Prime Minister Sanae Takaichi made no specific requests during their regular meeting to discuss economic issues and exchange general views. After meeting with Takaichi at the Prime Minister's official residence in Tokyo on Monday, Ueda said: "We discussed the overall economic and financial situation." Investors and economists are trying to determine whether a more politically secure Takaichi will try to slow the Bank of Japan's rate hikes to protect economic growth, or urge the BOJ to act to support the yen. Hideo Kumano, executive economist at Dai-Ichi Life Research Institute and former BOJ official, said: "Takaichi probably wanted to complete this meeting quickly to avoid unnecessary market speculation if a long time passed after the election before meeting. Ueda likely felt the same." As the meeting lasted only 20 minutes, it is unlikely that there was a lengthy discussion of policy paths. Ueda declined to comment on whether Takaichi agreed with his view on the BOJ's policy stance.



European governments may choose to accelerate the selection of a successor to European Central Bank President Christine Lagarde to avoid dealing with a far-right French president after the 2027 French election. Lagarde's term runs until October next year, and her successor is usually determined in the summer of that year. However, the risk that Marine Le Pen or her "successor" Jordan Bardella could win the French election starting in April 2027 may prompt European leaders to adjust the timetable.

Domestic News

The 2026 CCTV Spring Festival Gala featured the highest density of robots in history. Four robot manufacturers collaborating with CCTV showcased their products through skits, martial arts, song and dance, and New Year short films. On the main stage, six MagicBot Z1 humanoid robots and two MagicBot Gen1 robots performed alongside artists such as Jackson Yee and Jerry Yan. At the Yibin sub-venue, over a hundred MagicDog quadruped robots in "panda" style staged a grand group-controlled performance. Songyan Dynamics participated in the skit "Grandma's Favorite," marking the first appearance of humanoid robots in a language program on the Spring Festival Gala. Their N2, E1, Xiaobumi, and a bionic humanoid robot modeled after actress Cai Ming all performed on stage. (CCTV)



EHang's independently developed world's first eVTOL (electric vertical takeoff and landing aircraft) water airport was unveiled at the Yibin sub-venue of the Spring Festival Gala on the evening of February 16, creating a "dedicated stage" for actress Dilraba Dilmurat's dance performance. The SUNSHIP water airport, making its debut, is the world's first water airport built for eVTOL, with a total length of 36.5 meters and an area of over 300 square meters on the deck, serving as the takeoff and landing area for eVTOLs. (CCTV)